What is the best way to measure a country's happiness?

• Author: Adams, Tucker Hart

There has been lots of talk recently about the shortcomings of Gross Domestic Product, the most widely used measure of a country's output of goods and services.

Various pundits have argued that it is an incomplete measure of how well a country is doing, since, for example, it excludes unpaid work and includes the cost of treating illness.

A couple of years ago, I spent several weeks in Bhutan, a tiny Buddhist kingdom approximately the size of Vermont and New Hampshire combined, tucked between India and China in the eastern Himalayas. The country spreads from east to west, while the mountains run from north to south, which means there are two directions--up and down. One paved road bisects its length, too narrow for cars to pass except at an occasional turnout, with an average of 22 sharp curves per mile.

Its 700,000 people are mostly subsistence farmers (93 percent), scratching a living off of the 2.3 percent of the land suitable for growing crops. Every Bhutanese family has at least five acres (but no more than 25 acres) of ground, granted to them by their king. Guest workers are imported from India and Nepal to do roadwork and other heavy construction, since few Bhutanese apply for these jobs.

The country is a constitutional monarchy in the midst of a gradual transition to a parliamentary democracy, and its king measures his people's well-being by Gross National Happiness (GNH) rather than Gross Domestic Product (GDP). The basic concept is difficult to argue with--there is more to progress than the increase in the monetary value of the goods and services a country produces; we need a more holistic measure of how we are doing.

The devil is in the details. GDP measures the output of goods and services produced by labor, land and capital goods located in a country. GNH adds and subtracts various components based on value judgments made by the person or group making the calculation.

Some economists argue that such things as additional vacation time, shorter commutes and/or more time to interact with friends increase happiness. Yet Americans, who work about six hours a week longer than Europeans, spend far longer commuting and have less vacation, seem to be quite happy.

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